Exploring constraints of business productivity in a province nearby the country capital: The case of the UK and Vietnam

In this comparative study, we chose Hertfordshire in UK and Hung Yen in Vietnam, two provinces nearby the capitals of those countries respectively. These provinces have similar geographic characteristics and types of business structure. The study explores the constraints of business productivity.
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Exploring constraints of business productivity in a province nearby the country capital: The case of the UK and Vietnam VNU Journal of Science: Economics and Business, Vol. 36, No. 5E (2020) 31-49 Original ArticleExploring Constraints of Business Productivity in a ProvinceNearby the Country Capital: The Case of the UK and Vietnam Christopher Brown1, Nguyen Thuc Huong Giang2,*, Tran Thi Huong2 1 University of Hertfordshire, Hatfield, Hertfordshire, United Kingdom 2 Hanoi University of Science and Technology, No. 1 Dai Co Viet, Hai Ba Trung Dist., Hanoi, Vietnam Received 27 November 2019 Revised 20 December 2020; Accepted 20 December 2020 Abstract: In the digital era, the socio-economic and technological environment is changing continuously. Business productivity is becoming a more and more significant issue in the economy and it is essential to find out what motivates and limits productivity. The inequality in economic development of different provinces in each country is getting higher priority of government in both developed and developing countries. In this comparative study, we chose Hertfordshire in UK and Hung Yen in Vietnam, two provinces nearby the capitals of those countries respectively. These provinces have similar geographic characteristics and types of business structure. The study explores the constraints of business productivity. Hung Yen, one of Hanois nearby provinces, enjoys spillover benefits from the capital citys development. However, Hung Yen has to face many challenges from its geographical location and a shortage of high-quality human resources (people who tend to work and develop their careers in the capital). The same as Hung Yen, in the UK Hertfordshire is a county adjacent to London and suffers the same challenges related to graduate skills’ mobility and productivity gaps in the STEM skilled sectors. The correlation in business development issues between Hertfordshire and London is similar to the one between Hung Yen and Hanoi, in growth, hard-to-fill skills vacancies and productivity. In recent years, Hertfordshire has had numerous achievements in economic development and improved productivity growth. Therefore, the authors have focused on enterprises in these two provinces with their influencing/constraining productivity factors, including: i) innovation and technology through product/service launches; ii) workforce skill gaps; iii) leadership and management constraints; and iv) business constraints. From that, we propose some recommendations to foster business productivity of enterprises located in the two provinces. Keywords: Business, productivity, constraints, factors, Hung Yen, Hertfordshire.1. Introduction *_______* Corresponding author. E-mail address: giang.nguyenthuchuong@hust.edu.vn https://doi.org/10.25073/2588-1108/vnueab.4454 3132 C. Brown et al. / VNU Journal of Science: Economics and Business, Vol. 36, No. 5E (2020) 31-491. Introduction economic development, having a very fast technology innovation speed delivery. The TFP1.1. Productivity in the Digital Era of Vietnam has increased in recent years, which The 21st-century has seen a shift from the has helped contribute significantly to the GDPindustrial revolution to the new economic growth of the country.domination of information technology [31]. In 1.2. Local Issues for Enterprises in Hertfordshirethis “digital era”, digital technologies play a Addressing Productivity Challengesprominent role in shaping and regulating thebehaviors, performances and standards of the Over the last twenty years, the focus of thesocieties, communities, organizations, and UK government’s economic policy has been onindividuals [20]. Vietnam is assessed to be one improving UK growth and productivity [6]. Atof the fastest-growing countries in digital a national level, the SME community representstechnology development. Vietnam’s over 99.9 % of all businesses in the UK. Theinformation technology and e-commerce sector UK government’s focus before Covid-19 was,and digital financial services have been well-developed over recent years [4]. and after will be, on increasing the productivity In the digital era, applying digital of SME’s to both improve UK economictechnology can help enterprises enhance growth and employment opportunities [17].effectiveness, reduce costs, rationalize labor This same body of research suggests that thesedemand and strengthen innovative activities to businesses also recognize the importance ofbetter capture opportunities; thus reshaping investing in skills, R&D, and general capitalbusiness models and changing the barriers for assets. Effective supply-side and demand-sideintegration, improved transparency, and policies by the local UK ecosystem bothincreased firm productivity [21]. In the “Annual supports enterprises’ innovation and exporteconomic report of 2019: improving labor ...